Black Diamond Group Limited Announces Award of $100 Million in Large Camp Contracts and Provides Q2 Guidance Update
CALGARY, ALBERTA--(Marketwired - July 22, 2013) - Black Diamond Group Limited ("Black Diamond" or the "Company") (TSX:BDI), a leading provider of remote workforce accommodations, modular space solutions and oilfield services products in North America, is pleased to announce it has been awarded four large scale contracts to provide remote workforce accommodations in western Canada. The projects will house workers for customers serving a variety of industries including pipeline and infrastructure, mining and conventional oil and natural gas.
The terms of the contracts range from one to three years, provide for in excess of 1,600 beds and are projected to generate aggregate revenue of approximately $100 million. The projects will utilize existing and new equipment of Black Diamond. The new equipment will be acquired at a capital cost of approximately $20 million, which falls within the Company's announced 2013 capital expenditure budget of $117 million.
"These long-term accommodation projects compliment our already robust pipeline for the third and fourth quarters," said Trevor Haynes, President and CEO, "We are very pleased with the level of visibility we have going into the second half of 2013 and anticipate considerable growth on a year-over-year basis."
Q2 Guidance Update
Further to the guidance previously provided in the Company's first quarter 2013 results, the financial results for the second quarter of 2013 are expected to be moderately stronger than the second quarter of 2012, however, due to annual seasonality together with the project sequencing gaps during the quarter, with several large projects being completed and new projects coming on-stream, the 2013 second quarter financial results are expected to be significantly weaker than the first quarter of 2013.
Management of the Company anticipates strong financial results in the second half of 2013 and first half of 2014 based on new contracts and visibility of business development. The results will be driven by the significant investments made in the Company's fleets and operated facilities throughout 2012 combined with overall strength of the Company's business platform plus large, long-term projects coming on-stream throughout the second half of 2013.
About Black Diamond
Founded in 2003, Black Diamond Group Limited is a provider of remote workforce accommodations, modular space solutions and oilfield products and services in Canada, the United States and Australia. With its corporate head office located in Calgary, Alberta, Black Diamond provides its products and services to a full spectrum of industries including oil, natural gas, mining, power, construction, engineering, military, government and education.
Through its direct and indirect wholly-owned subsidiaries and through its approximate 50% equity participation in certain aboriginal limited partnerships, Black Diamond operates four complementary business units comprised of Black Diamond Structures, Black Diamond Logistics, Black Diamond Energy Services and Black Diamond International.
Black Diamond Structures rents and sells remote workforce housing and modular workspace solutions and provides associated services; Black Diamond Logistics provides turnkey lodging services, remote facility management and supply chain solutions; Black Diamond Energy Services rents and sells a complement of oilfield equipment and services; and Black Diamond International rents and sells remote workforce housing and modular workspace solutions and provides associated services outside of North America.
Black Diamond operates its four complementary business units in 17 strategic locations across Canada, the United States and Australia.
Certain information in this news release contains forward-looking statements including management's assessment of the projected revenue to be generated from the remote workforce accommodation contracts, how the new equipment to support the accommodation contracts will be funded by the Company as well as the expected capital cost of such new equipment and management's future expectations of the operational and financial performance of the Company set out under the heading "Q2 Guidance Update". These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond Black Diamond's control including, without limitation, the impact of general economic conditions, industry conditions, fluctuation of commodity prices, fluctuation of exchange rates, environmental risks, industry competition, availability of qualified personnel and management, stock market volatility, timely and cost effective access to sufficient capital from internal and external sources. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements. Readers are cautioned that the forgoing list of factors is not exhaustive. Additional information on these and other factors that could effect Black Diamond's operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com) and at Black Diamond's website (www.blackdiamondlimited.com). Furthermore, the forward-looking statements contained in this news release are made as at the date of this news release and Black Diamond does not undertake any obligation to update publicly or to revise any of the forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.
Future Oriented Financial Information
This news release, in particular, the projected revenue to be generated from the remote workforce accommodation contracts, contains Future Oriented Financial Information ("FOFI") within the meaning of applicable securities laws. The FOFI has been prepared by management of the Company to provide an outlook of the Company's future activities and anticipated results and may not be appropriate for other purposes. The FOFI has been prepared based on a number of assumptions including assumptions with respect to the terms of the contracts. The actual results of the operations of the Company and the resulting financial results may vary from the projections set forth herein, and such variations may be material. The Company and its management believe that the FOFI has been prepared on a reasonable basis, reflecting management's best estimates and judgments.
President and Chief Executive Officer
(403) 264-9281 (FAX)
Black Diamond Group Limited
Executive Vice President and Chief Financial Officer
(403) 264-9281 (FAX)